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Managing Your Workplace Pensions in UK

As a rule, a pension provider will set up, run, and manage your workplace pension. But, there are several other key factors to consider about pension management.

WORKPLACE PENSION MANAGEMENT: You will want to know how much money you have saved in your pot.

This information comes in an annual statement sent to you by your pension provider.

Most pension providers can also help you get an estimate of your retirement amount – if you want one.

What will you see on your payslip? It shows the net pay or the relief at source, depending which arrangement your workplace uses.

Ask your employer if you need more information about payslip details. You get automatic tax relief on your pension contributions without doing anything.

Workplace Pension Net Pay Arrangement

What are net pay pension arrangements? It means your employer deducts a contribution from your salary before it gets taxed.

This method means you only pay tax on the remaining amount of your wage. You also get full tax relief whether you pay tax at the basic or higher rates.

Note: Your pay slip shows the amount of tax relief plus your contribution added together. If you earn less than the tax threshold then you will not receive tax relief.

Workplace Pension Relief at Source Arrangement

What if your superannuation contributions follows the ‘relief at source’ arrangement? Your employer takes your tax and National Insurance from your wage before making the contribution to your retirement fund.

Your fund provider adds tax relief to your pot at the basic rate. If you pay higher or additional rates of Income Tax you may be eligible to claim back money in some cases.

Note: Relief at source means the amount you see on your payslip is only your contributions and not the tax relief.

Find Lost Pension

The Pension Tracing Service deals with the tracing of lost pensions. They may be able to help you find paid investments which you have lost track of.

Choosing Someone to get Your Pension if You Die

Unfortunately we do not all reach the scheme’s pensionable age and enjoy the full pension pot. Part of planning for your retirement is nominating someone to get your benefits if you die.

You should make this provision when you first join the scheme. But, you can do it afterwards by writing to your pension provider. They will confirm if this is possible and what amount of money the nominated person would get.

You can change the nominee at any time. But it is important to keep this information up to date along with the nominee’s contact details.

When Can You Take Your Pension?

You should decide how and when you want to start receiving your old age payments. In the United Kingdom most superannuation schemes set an age when this can happen. It determines from what age you will get your retirement payments.

As a rule you can take your benefits between the age of 60 and 65 in Great Britain. There are some circumstances which allow you to take pension payments earlier. But, the earliest would be the age of 55 in most cases.

Some companies may offer you a way to get money out of your pension before you reach 55. Taking an early pension in this way may mean you pay tax up to 55%.

In some cases you can take the pension as a lump sum if your pot is on the small size. In this case, 25% will be tax free but Income Tax is liable on the rest. The type of pension scheme you enrol in determines how you get your money.

Managing Defined Contribution Pension Schemes

Those who are in a defined contribution pension scheme will need to decide how to take the money.

Managing Defined Benefit Pension Schemes

Those who are in a defined benefit pension scheme may be able to take some funds as a tax-free lump sum. Your pension provider will confirm if this is possible. In this case you would get the rest of the fund as a guaranteed amount each year.


About Workplace Pensions: An overview of workplace, work-based, occupational, or company pensions.
Joining a Workplace Pension Scheme: All employers must provide a works pension scheme by 2018.
Payments and Contributions: Check what you, your employer, and the government pay into the pot.
Workplace Pension Protection: The type of scheme you have determines how a pension gets protected.
Changing Jobs: Find out what happens to your company pension if you change jobs or take leave.
Opting Out: Check your rights and the correct process for ‘opting out’ leaving a workplace pension.
Workplace Pension Helpline: Free information and advice taken from The Pensions Advisory Service.

Managing Your Workplace Pension Scheme in the United Kingdom